Steps to consider to start and grow a company. Basics are provided to help entrepreneurs. Examples may relate to Biotech, Pharma and Medical Device businesses, but the ideas apply to most technology fields.

Monday, April 30, 2012

A friend recently sent me some slides for an upcoming presentation.
Included in the presentation was a slide
titled, “Founder’s Disease.” He defined
Founder’s Disease as the “Lack of Timely Decision Making, in a Thoughtful and
Logical Manner.”He further indicated
that the result of the disease is “the Singular Cause of Delays, Wasted Effort
and Needless Expenditures in Product Development.”

Founders sometimes are not familiar with the processes involved in
developing their products and often, they lack the experience to price or
manage the development process.They may
have identified an experienced team, but the ability of managing or in trusting
the team has not developed enough to rely on the team.This is often the case when founders that
have never been in an operating role in a business.

Founders come with a wide range of experiences.Nearly all founders are highly educated and
smart and they have the entrepreneurial spirit.Being smart and having latched onto a technology they love does not
equip them to manage a company.This is
one of the reasons that having great advisors and a good Board of Directors is
important.The founders can gain from
experiences of others and implement the correct strategies.Lack of experience is also the reason that
investors may elect to replace the founder post investment.

Unfortunately, having all
the tools does not lead to using them correctly.Picking out the wrong tool, or being bogged-down
in the decision process, slows progress.Founders being smart can result in them believing they have the answers
or in engaging in extended analysis but no decisions.They forget that the ability to make decisive
decisions in a timely manner saves money and eliminates confusions.They remain highly focused on making the
right decision but not on ending the process with a decision.

The ability to make these decisions also complicates their negotiations.Founders forget that having specific goals
and needs are part of the process.Negotiations should not resemble the process of “trying to nail Jell-O
to the wall.”Negotiation
strategies seeking the endpoint of lowest price without a working relationship
can result in a bad result.Similarly, negotiating
with no real idea of what the result should be, makes for a bad relationship in
the end.

As a founder, you should develop strategy and confirm the strategy
with your advisors.Ensure there is
logic and business in the decisions and that it makes good sense.Trying to proceed any other way is like
trying to play chess with a Professional Ranked player.You will likely loose in the end!

Watch out
for Founder’s Disease!Make
solid decisions with help from the right members of your team.Remember that you have a team of people and
getting their input may help you save or make money.

Thursday, April 26, 2012

Managers with employees often have relationships that seem
strange.This assumes the manager is
aware of the fact the staff are acting in a manner that suggest problems.Actually, as a manager, it is common to be stuck
on what your needs and goals are and miss all the signals emanating from the
staff.

Take for example a strained relationship where the employee thinks
you are like Scrooge.It is very
unlikely anyone on your team will bring this to your attention by a direct
statement because people feel that providing negative input can result in loss
of their job. When the team is having
problems, they may start to show signs, but you have to be aware of them.One of the signs might be “passive resistance.”As a boss, you might interpret passive
resistance as the person just not performing the job.They may be telling you they have a problem
by saying they will tackle the job, but then go so slow that you would have
been better doing it yourself.

Another indication might be that when you walk through the
building, people are not visible.They may be taking cover because they have
problems being around you.They
recognize your interactions with them are so negative they would like to fade
into the background.Possibly, they are
coming in late or working hours that lessen the interactions.Maybe they are taking extended leave beyond
what seems normal.

Your skills must include an interpretive set that helps to
evaluate the people you work with.They
do not have to love you, but they should respect and feel they can work with
you.When you miss their indicators, you
leave the relationships to chance. Developing these skills is something that
takes time, but will help you in the end.

Take an example of a work place where office workers come in and quit
to take other jobs in less than a year creating a high turnover of employees.One or two workers departing may not raise
your antennae but if this happens repeatedly over several years, you may want
to review the issues and determine if it is YOU.The boss dictates the activities to perform
but never establishes a real relationship with the team. Always working with a demanding boss that
underpays you is not a motivational experience.Scrooge sometimes had a better relationship with Bob Cratchit than some
bosses have with their team.

A poor attitude toward the team evolves over time and can
eventually creep into the way you behave with your potential partners.Approaching partners with a “hand
full of give me” and offering nothing in return does not lead to a
great relationship.You need your business
partners just as you need your team.None
of them are your slaves or furniture there for your abuse.They are people and want to be treated with
respect and to be recognized.

In short, if things seem to be going strangely around you, perhaps
you need to say, “Interpreter Please.”
This may be someone you trust in the organization or as a mentor that will help
you take a close look and understand better what is taking place.Waiting for the sky to fall is not the way to
run the business and morale will suffer.Remember, there is no I in TEAM.Treat them as if you need them.

Tuesday, April 17, 2012

Entrepreneurs often were managers in a prior position.They had specific duties relating to a narrow
field like product development, business development, or some other unique
function.This was the case with
me.I ran a major research program
during my early years and later was involved in business development.Yes, I did micromanage my team early on, so I
am telling you to do something I did not do well in my early years. TRUST YOUR
TEAM!

Interestingly, one of the issues that new managers miss is that
when they take on broader roles in the company, they tend to help the certain
teams too much and ignore others.Those
getting the help are in areas the new manager knows the most about and they
tend to stay away from those areas they know the least about.A pattern can emerge if you are not careful
and that is one of micromanaging a select team and not managing the rest of the
company.This leads to all kinds of
problems with the team and their morale.

Interacting with new CEOs is always enlightening.You see a remake of your life years ago.For example, the micromanaging issue is one
that you can advise on, but you know that once upon a time you did it too. You can alert the CEO but you cannot make them
change overnight.

It is so easy to make the team disenchanted when they have you are
watching them around the clock on every issue and they feel you will override
their decisions.Likewise, those not
receiving any interactions think you do not care and tend to slack off their
duties.This has a tendency to be a NO
WIN for all concerned.

You need a great team working for the startup and want them to
work as a team.You spend significant
time and resources trying to recruit them to the early stage company, which
they see as risky.Doing a great job on
recruiting is half the battle.The other
half is with your ability to provide objectives and monitor their
progress.It is fine to interact when
they need help, but try to hold back when they do not.Have regular meetings to get reporting on
tasks and milestone completion.You can
try to spot problem points and provide suggestions.This is a balancing act, but if you do not do
it right you will move too far to the right or left.

Your team is the company’s greatest asset with the product being
second most important.Learning to
manage your team without over managing or under managing them is a task worthy
of your learning.If they are great,
learn to trust them to deliver.They may
deliver in a different way than you would have but who cares.Ask a simple question, did they do what was
expected? How they did it may be much less important.Maybe you will find they did the job
differently but in a manner that was better for the company in general.

Tuesday, April 10, 2012

I once had a boss that would provide input to questions in a
highly political manner.His advice
often allowed for multiple interpretations depending on the mood you were in
that day.It became difficult to follow
the directions, but he was skilled and a good manager.The difficulty was in communication to the
staff not in the quality of the directions, assuming you figured out what they
were.Eventually, I learned to interrogate
the boss to clarify and narrow down on the actions or suggestions.I may have appeared as more aggressive, but
it was necessary.

In running a company, I always had to keep expenses down as well
as hold on to equity and not distribute it like candy.This was my fiduciary duty.Employees always wanted higher pay or more
options.For me, finding balance was not
easy.Giving out too much would not be
good management, giving out too little make me look cheap.Bet you can guess how I managed things.I learned to use the political speak of my
former boss to keep people in check.So
what if I was cheap and unclear!

Working with contractors and keeping fees low was also part of
duties.Never mind that contractors
learned that fee reductions resulted in lower level people working on the
assigned tasks.The company paid lower
fees.So what if it took longer to get
tasks done or that they were not to the desired standards.At least it appeared to cost less, sort
of.Guess I never took into account the
fact that quality and overruns may have evened out the lost capital for the
contractors.

The above partly applies to me, but it covers so many entrepreneurs
in startups, I wanted to stress the point without naming names. In your startup, do you provide clear
definitive instructions?Do you hold a quarter
so tight the “Eagle Screams?” There is a
balance and you need to find it early in the company’s development.Your employees are discussing you and your
management style, or maybe complaining about you and your style.Maybe you have a complete lack of style!

Do not be surprised when one day someone says you are an ASS; they
most likely have been calling you that behind your back for a long time.You may respond, “I Am a What?”Realize that how you present yourself to
others will define how everyone believes you will behave.You may be the greatest person and care about
all those you work with, but failing to act that way will cause partners or
employees to eventually desire to work elsewhere.You need their best work and you need
dedication!

Try striking balance in your business dealings.You want your partners and employees to
perform with enthusiasm and deliver quality.You want them to be advocates of the company, not seek other places to
work.How you behave around all those
you meet or work with will send a clear message.Make sure it is the message you want
delivered.

Friday, April 6, 2012

Negotiating
can have positive and negative aspects.Discussions often focus on what each party gets and whether they believe
it is enough.When parties are too far
apart, the discussions stall and people believe they are so disadvantaged that
they want to walk away, or worse, they decide to take negative actions that
harm both parties.It is extremely
important to read the tealeaves and head this type of event off before it goes
too far.

The ability
to recognize whether discussions are moving toward an impasse is not too
easy.Sometimes you will have to look several
steps ahead much like playing chess.Chess is a game that requires considering multiple moves at level one
followed by the potential for subsequent moves including possible opponent
countermoves.The great players can see several
moves in advance as well as predict the countermoves of the opponents.The same is true for military actions.Great generals are always assessing the
landscape, strengths, moves, countermoves and plan actions in an effort to win;
just like in chess.It is your ability
to consider all the options and countermoves in a negotiation that can help you
see a stall coming.

One of the
best ways to increase the benefit and prevent a stall is seeking a Win-Win.This concept described in the books on
negotiations.A Win-Win is exactly as it
sounds; both parties come out of the negotiations feeling that they won
something important to them.The parties
feel good about what the accomplishment and believe they can work together in
the future.

Getting to a
Win-Win sometimes works by seeing the issues from both prospective, yours and
the other sides.Adjusting the
parameters of a deal to address the key issues of each party and describing how
the proposal works for you and for them.Modification of deal parameters with mutual input seeking this type of
resolution often makes for a lasting arrangement with minimal conflict later.

One of the
ways to manage expectations of financial benefit is to seek ways to increase the
size of the benefit such that what each party receives is larger. This means
working on a way to increase the total value of a fixed percentage; i.e. would you rather have 10% of $1M or
10% of $1B.Seeking a way to improve the
payout can really help turn the discussion to something that leaves both
parties excited.

The one
factor that is always fun and leaves everyone pleased is winning 2 times, or 3
times.This means that you complete a
deal to find a second level expected or unexpected benefit. Take for example a
case of negotiating a sale of a company at a fixed price.Both parties are happy with the deal but
discover a third buyer may be approached which increases the payout to the
original two parties.The option may
have never been considered, but as part of the discussion, it circumstances took
it to a reality.Another case it two
companies completing a deal sending out a press release.Enthusiasm from the release led investors or customers
to bid up the company valuations or dramatically increase sales.

Seeking a Win-Win
is a great way to go if you can move the discussions that way.Actively seek the “Win Twice or Even Thrice”
opportunities will just make you that much happier!

Thursday, April 5, 2012

Starting a
company will come with many stresses and strains over a prolonged time.Even well run companies have issues that
arise and the issues may start or add to conflicts or problems.One of the things you can do to ensure your
potential success is to build a great team.Building relationships and fostering team spirit may be the things that
can help get through the tough spots.Keep in mind that the team members have differences in their ability to
tolerate stresses, react to activities, and interpret situations.As the team leader, it will be your
responsibility to help foster the team spirit and guide them through the tough
spots.

Over the
years, three questions have emerged to the top of my list when giving advice to
friends, team members, and the leaders.Keep in mind that during the great times as well as the difficult ones
all individuals need to retain their motivations.It is very hard to go to work each day and
perform to the optimal standards once people become disenchanted.It is also difficult if some of the
infighting starts or disagreements develop.Money, salary, recognition and other factors can move the situations to
become more stressful.

Ask yourself
three questions when you are deciding to join, stay or leave any business or
job.These may apply to all sizes of
businesses and not just to startups.The
advice applies to entrepreneurs and every member of the team.It may be hard to make the decisions, but the
advice can serve as a guide to help in the process.The questions are valid to ask, but your
level of financial resources will have some bearing on your ability to stick with
the business.Regardless of whether you
are an employee or the leader, these questions relate to you, hence they go
both ways.Your answers to these
questions may help you determine whether sticking out the tough times is worth
the effort.

Do you like the business?I have become a strong advocate of advising people to work with
businesses they feel strongly about.Being motivated by what you are doing and finding it enjoyable it
important to your desire to perform well.Hating what you do every day will eventually lead to a loss of drive.Your performance may suffer and the company
may not derive the expected benefit from your work. Consider a position change
in the company or leaving the company.

Do you like the people?Going to work you will be seeing some of the
same people every day.A company with
multiple locations may even have your boss at a remote location but you still
interact regularly with this person.People
you work are the ones you will rely on as the team tackles difficult
problems.If you do not feel the
connections, dislike them, or do not believe you can work with them in a proper
manner, your work and the team’s effort will eventually suffer.The leader should attempt to foster relationship
building when possible, making sure the team work and play well together.

Do you trust the people?Trust is a most critical characteristic of any
relationship be it personal or business.Partners need to know they can trust each other and agreements reached will
be honored.Employees need to feel they
are respected and will not be taken advantage of.The employees also want to feel their work receives
the credit it deserves and others do not take the credit improperly.Most any of aspect of personal and business
relationships are built on trust for the relationships to last.As a leader, help see that trust becomes part
of the company building efforts.

Wednesday, April 4, 2012

Early in
startups, management devotes extended time and effort planning for budgets,
timings, and goals.Corporate presentations
will contain key areas that you wish to communicate in an investor pitch.Eventually, you may add a positive spin to
some portion of the data or answer to a questions to try to gain a more
enthusiastic response.Presidents do it
all the time.Just watch TV and you will
see the Spin-Doctors going to work.We
always tend to reinvent or create a story that is more easily understood or
better explains events that took place in history.This tendency to revise history to explain
events is a topic covered in several books.

One of the
more interesting problems comes when you are asked questions and you are unsure
of the answers. Sometimes CEOs will create a response on the spot and it will
not have been fully thought out.Standing there with everyone looking at you waiting for a response can
be unpleasant when you feel unsure of answers.It at this moment you use one of your lifelines and use a WAG for the
answer.Yes, it does happen and most
people in the right situation will do it!

A CFO first
introduced me to the WAG about 10 years ago.We were making a corporate presentation to potential investors.One of the group asked an unusual and unexpected
financial question.As a team, we were
quite analytical and most of our financial issues were well thought out.We were prepared to answer key questions and
had practiced the responses.The unusual question was interesting.Clearly, I was caught off guard and unsure
how to answer.Then my CFO came to the
rescue and offered a response.It
sounded great and I thought I was off the hook.The investor then asked how the answer was derived and the CFO said, “It’s
a WAG.”I did not know what that meant
at the time and just thought it was a financial term.

I guess I was
not the only one in the room that did not understand this new term.Another person in the room said, “What is a
WAG?”Then in a very serious tone, the
CFO says, “Wild ASS Guess.”The tension
was broken and we engaged in a dialogue to address points around the financial
issue.If the WAG had been too far out
of line, we may have been asked to exit rather than continue to talk.

The point is
that when you are asked really difficult questions that you are not prepared
for, you may decide to GUESS.It is
possible to get into trouble at this point.Investors are trying to learn facts.Leaving them with information that is not accurate is WRONG and can lead
to legal problems!If you are guessing,
you need to make sure they understand the answer cannot be taken as fact.One alternative is to say, “we need to review
this question and will get back to you with an accurate response.” It is OK to not have all the answers it is NOT
OK to leave behind misleading information.Just make sure if you offer a WAG it is identified properly and has some
measure of creditability.Then follow up with more solid information when
you have worked through the problem.

Monday, April 2, 2012

I have
wonder often what people see that is different from what I see.Clearly, we are looking at exactly the same
thing and the language as written could not be any plainer.Yet, for some reason people react differently
or interpret what they see differently.

Over the
last few weeks, I was traveling through an airport going through security.The signs at the start of the line cannot be
any clearer.They even have pictures of
what you can and cannot take through security.If that is not enough, the TSA agent is shouting out instructions that
spell out the info.Even if you missed
all of that, between the check in process providing information and the regular
discussion on the news, you would think even the most unsophisticated traveler
knows the info. Wrong!

Buying great
wines is costly and getting it home safely is important.However, I fail to see where the instructions
at the security line allow a traveler the right to take 5 bottles of wine in
the carry-on luggage.They apparently
read some of the instructions since the cosmetics and other items are neatly
displayed in bags ready to go through the x-ray scanner.What did they see that told them they could
take 5 bottles of wine through in a suitcase?Why did they seem surprised when the TSA agent took them to the ticket
counter to check the bag and tell them to go back through security again? Oddly enough, the same line with the wine travelers
had a younger adult that pulled a completely filled 2 liter water bottle out of
a bag.The person took the bottle out
and asked if it could go through the security screen.At least the person asked, but I thought the
instructions were clearer than that.

Simple day-to-day
activities and written statements often mean different things to different
people.They may be wrong in an
interpretation, but they have a different one.How does this relate to your startup?Even simple agreements that are short and apparently clear can have
different interpretations to different people.It always seems strange but a person seeing a glass half-empty or half-full
but not both.It is always important to
keep these differences in mind because working through the differences can lead
to success or failure.There are always
two sides to every story even in business! This can occur in written documents,
people’s personalities, and approaches to problems.